HB 404 Alabama House · 2026 Regular Session

Class 1 municipalities; authorization to establish community land trusts, affordable housing

HB 404 authorizes Class 1 municipalities in Alabama to create nonprofit community land trusts that provide affordable housing to low-income and moderate-income families through long-term 99-year ground leases. The trusts must lease land (not sell it) to qualifying families earning 80% or less of the area median income (low-income) or up to 120% (moderate-income), as defined by HUD. Key provisions require trusts to be membership-based with public meetings, have a diverse board appointed by the mayor and city council, and include resale rules to maintain affordability. This bill directly affects eligible families seeking stable housing and municipalities seeking new affordable housing tools, with no tax implications for the trusts’ properties.

Issues: ✓ Housing

Bill status signed all 5 stages cleared

Introduction

Feb 2026

Committee Review

Apr 2026

House Passage

Mar 2026

Senate Passage

Apr 2026

Signed into Law

Apr 2026

Introduced Feb 5, 2026 Signed Apr 17, 2026

Maddy AI version diff · 2 comparisons

What changed between versions

Engrossed → Enrolled · 6 edits · Apr 17, 2026

MODERATE

The bill transitioned from an 'Engrossed' draft to its final 'Enrolled' version, incorporating significant substantive changes to the definitions of affordable housing and community land trusts. These updates expand the types of federally assisted housing that qualify as affordable and clarify the specific requirements for entities organizing these trusts.

Scope change

The bill's scope remains focused on Class 1 municipalities, but the definitions of eligible housing and trust structures were broadened to include more federal programs and specific organizational criteria.

DEFINITION

Added detailed definitions for 'Other Federally Assisted Units' to explicitly include USDA, HUD, and public housing programs, ensuring a wider range of affordable housing projects qualify.

Added a new definition for 'COMMUNITY LAND TRUST' requiring the entity to provide affordable housing via ground leases and be organized by a Class 1 municipality.

Updated the definition of 'GROUND LEASE' to explicitly state the lease is designed to ensure the property remains affordable housing.

Added a new definition for 'PROCEED-SHARING PROVISIONS' to clarify how sale proceeds are split between sellers and future affordability preservation.

Added a new definition for 'PUBLIC RECORDS' to clarify that community land trust transactions are treated as public records for transparency.

Corrected a typo in the 'MODERATE-INCOME FAMILY' definition by adding the word 'area' before 'income' for consistency with other definitions.

Floor votes

How they voted

This bill passed the Senate by voice vote (no roll call recorded).

Full legislative history

Actions timeline

Total actions

Key actions

Committee

Amendments

Apr 7, 2026

Upper · Passed

Motion to Read a Third Time and Pass - Adopted Roll Call 1163

upper

Apr 2, 2026

Upper · Passed

Reported Out of Committee Second House

upper

Apr 1, 2026

Upper · Passed

Pending Committee Action in Second House (Jefferson County Legislation)

upper

Mar 31, 2026

Lower · Passed

Motion to Read a Third Time and Pass as Amended - Adopted Roll Call 1110

lower

Mar 31, 2026

Lower · Passed

Motion to Adopt - Adopted Roll Call 1109

lower

Mar 31, 2026

Introduced

Rafferty 1st Amendment Offered

lower

Mar 31, 2026

Lower · Passed

Motion to Adopt - Adopted Roll Call 1108

lower

Mar 31, 2026

Introduced

County and Municipal Government Engrossed Substitute Offered (County and Municipal Government)

lower

Mar 18, 2026

Lower · Passed

Reported Out of Committee House of Origin (County and Municipal Government)

lower

Feb 5, 2026

Lower · Passed

Pending Committee Action in House of Origin (County and Municipal Government)

lower

1 primary · 0 co-sponsors